Walgreens Inches Closer To Rite Aid Acquisition

According to sources, Walgreens Boots Alliance is in talks with the Federal Trade Commission over what the company needs to sell to gain regulatory approval of the $17 billion deal.

A merger of the two companies would create the biggest drug chain in the country, even out ranking CVS Health. Walgreens is No. 2 and Rite Aid is No. 3 currently.

Sources have revealed that the talks between the FTC and Walgreens are over divestitures and is a sign that regulators are open to approving the merger.

The sources say that Walgreens is now quietly auctioning stores in areas where the combined chain would have too much overlap. “Multi-divestitures take time,” a source close to the process said.

It was last October when Walgreens made the announcement that the company would buy Rite Aid for $9 a share.

Shares of Rite Aid have dropped in recent weeks on fears that the merger would be denied. They saw a slight bounce after this week’s big news.

Disclaimer: We have no position in Walgreens Boots (NASDAQ: WBA) or Rite Aid Corporation (NYSE: RAD) and have not been compensated for this article.